Traditionally, feature length movies are first released only in cinemas. Such movies open on the same day in various theaters throughout the country. These movies have a release date that specifies the day on which the public can go to the theater to watch the movie for the first time. Depending on its popularity, a movie can play in cinemas for weeks or months. During this time, the public can only view the movie in a theater. The movie is simply not available on digital video disk (DVD) or television until months later.
One drawback with this traditional model (i.e., only showing movies initially in cinemas) is that other venues and media are not used while the movie plays in the cinema. These other venues represent great potential revenue for the movie. For instance, some people want to see the movie, but will only watch the movie on a DVD at home, on a personal computer, or in a private environment not in a movie theater. Many of these people will never go to see the movie in the theater and thus represent lost revenue for the movie. Granted, such people have the option of buying or renting the movie when it is released on DVD many months later. At this later date, however, many of these people will have lost interest in the movie and simply never buy or rent it.
Another drawback with this traditional model is that many movie goers would place significant value on viewing feature length movies before others. In other words, some movie viewers are willing to pay extra to watch a movie before the movie is available to the general public. The traditional model does not cater to showing the movie first to a specific group of public movie goers since feature length movies are generally available to all movie goers on the release date.
Another drawback with this traditional model is that revenue is lost if feature length movies are not adequately tied to the sale of other goods and services. In the traditional model, movie goers can view feature length movies in a theater without buying a good or service that is associated with the movie.